P3 Projects in China Rise at Steep Pace

Public-private partnerships (P3s) in China that are used to build up infrastructure, among other projects, have been increasing in number and investment value as more projects are set to be implemented this year, according to a new report by Moody’s Investors Service.

"Support from the central government has resulted in positive regulatory developments in China's Public-Private Partnership (PPP) framework, thereby enhancing the financing options available to PPP developers and investors," said Osbert Tang, a Moody's vice president and senior analyst. "And, regulations that increase transparency and improve investor protections are positive for the ongoing development of the PPP sector."

More long-term financing and improved regulatory transparency for Chinese P3 projects are likely to lure more private investors, Moody’s said.

P3 projects in China’s national database grew by 21.5% or $436.8 billion for the first six months of 2017, as 20% of the projects were in the implementation phase—the penultimate stage of such projects—at the end of June, compared to 17% at the same time of year in 2016, Moody’s said.
The total number of P3 projects in China at the end of June was 13,554, up 20% from the end of 2016. The total investment value of these projects was $2.47 trillion at the end of June, up 21.5% from the end of 2016.

– Nicholas Stern, managing editor

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